Dr. Khashanah Leads Talks on Financial Systemic Risk in Washington, DC

5/28/2013

Dr. Khaldoun Khashanah will be speaking in Washington, DC at the 2013 PRMIA DC & FinRisk: Risk Management & Regulatory Summit on May 29, 2013 as well as the 2013 Financial Stability Analysis Conference, sponsored by the Federal Reserve Bank of Cleveland and the Office of Financial Research on May 30 - 31, 2013.

Along with colleagues Allan Mendelowitz, Strategic Advisor, Deloitte Consulting and Dr. Willi Brammertz, University of Zurich/ET,  Dr. Khashanah will give a talk on:   “Improving Systemic Risk Monitoring and Financial Market Transparency:  Standardizing the Representation of Financial Instruments.”

The 2013 Risk Management & Regulatory Summit is sponsored PRMIA DC Chapter and The Financial Risk Institute. Both organizations are capitalizing on their strategic location to bring together top regulators and supervisory officials, financial institution risk managers, market analysts and leading academics to discuss key issues surrounding Implementation of Systemic Risk Regulations.

The 2013 Financial Stability Analysis Conference in Washington, DC sponsored by the Federal Reserve Bank of Cleveland and the Office of Financial Research will focus on: research and practical experience in using tools that measure potential threats to financial stability; and the challenges related to including supervisory and other confidential data in these tools. Accordingly, the agenda will feature research and policy sessions that include presentations and discussion panels on related topics; it will bring together academics, policymakers, and market participants.

Talk Abstract: The financial crisis of 2008 made one fact absolutely clear:  neither government financial policy makers and regulators nor firm level executives and risk managers had the data and analytics to understand the risks they were facing.  The Dodd-Frank Act (DFA) recognized this deficiency and included specific provisions to correct the situation.  These provisions require the Office of Financial Research (OFR) to create two critical reference databases and reporting standards for reporting granular transaction and position data: to create unique identifiers for counterparties to financial obligations, and to standardize the representation of financial obligations suitable for the analytical use case.  Good progress has been made on the first reference database as part of the Global Legal Entity Identifier (LEI) effort.  This session discusses progress on the second reference database, the standardized representation of financial instruments, to address the challenge of financial market complexity to cover virtually all different types of financial obligations, with a high level of precision.  This session discusses the proposed approach to this, which focuses on state-contingent cash flows which are the aspects of financial contracts that are the critical inputs to financial analysis.